Vape Manufacturer Supreme Acquires Typhoo Tea in £10 Million Deal

Vape manufacturer Supreme has acquired Typhoo Tea in a £10 million transaction, a move Supreme stated would ensure the brand remains “in British hands”. The 120-year-old tea producer had entered administration in November following a decline in sales and an increase in its debt. Supreme, based in Manchester, produces the 88Vape e-cigarette brand and supplies nicotine and household items to various supermarkets. Typhoo presently employs fewer than 30 individuals in the UK, primarily in sales and marketing roles, as a significant portion of its operations, both domestically and internationally, has been outsourced over time. During the 1980s, its advertisements showcased prominent television personalities, such as the late presenter and singer Cilla Black and the late actor and comedian Frankie Howerd. A notable advertising slogan was “you only get an ‘oo’ with Typhoo”, and a well-known commercial depicted entertainer Su Pollard being serenaded by ponies while consuming tea on a beach. In 2016, celebrity chef Nigella Lawson was appointed as a brand ambassador. Supreme’s chief executive, Sandy Chadha, commented, “Typhoo is such an iconic brand.” The company indicated that its choice to acquire Typhoo stemmed from a combination of “sound business rationale and personal affinity.” Furthermore, Supreme stated that this acquisition aligns with its strategy to diversify into additional sectors. The company currently collaborates with brands in soft drinks, gym supplements, and multivitamin gummies, alongside non-food products like batteries and home lighting. It also produces sports nutrition, wellness products, and soft drinks, and operates its own e-commerce platforms for direct customer sales. Supreme’s distribution network extends to retailers such as B&M, Home Bargains, Sainsbury’s, Tesco, The Range, and Poundland, in addition to the HM Prison and Probation Service. Susannah Streeter, an analyst at Hargreaves Lansdown, suggested that Supreme secured a favorable deal by acquiring the company from administration. She further noted that “it’s highly likely that Supreme will want to steam ahead and find efficiencies to cut costs and try and coax the company back to profit.” Streeter also observed, “It has loyal custom it can build on, but also will spy new opportunities given tea’s wellness image to tie into the ambitions of its supplements and multivitamin arm.” Typhoo entered administration following an increase in its pre-tax losses from £9.6 million to £38 million. Its sales decreased from £33.7 million to £25.3 million, as per its most recent financial results for the year concluding September 2023. The company’s liabilities surpassed the value of its assets, and expenses incurred due to a break-in at its Wirral facility exacerbated its financial difficulties. However, Supreme characterized the acquisition as a “significant step” and expressed confidence that Typhoo would “thrive” due to the strong brand loyalty demonstrated by its customers. Despite being positioned at the more affordable end of the tea market and undergoing a rebrand effort, Typhoo had been experiencing a decline, which analysts attribute to a broader reduction in black tea sales. While tea remains a daily essential for many in Britain, competition from beverages such as coffee, soft drinks, and herbal tea has impacted its sales. Nevertheless, even with consumers reducing spending due to rising prices, Typhoo maintained its position as one of the leading tea brands, alongside PG Tips, Tetley, and Yorkshire Tea. The introduction of own-label brands by supermarkets has also contributed to the diminished market share of established names.